Configure ModelSim simulation to display text

One thing you can do that is should work across all simulators is to create a signal that holds an ascii string, and then change the radix of that signal to ascii in the simulation window:

reg [8*8-1:0] mytextsignal;
always@(state) begin 
    case(state) 
        S_IDLE : mytextsignal = "  S_IDLE";
        S_START: mytextsignal = " S_START";
        S_STOP:  mytextsignal = "  S_STOP";
        default: mytextsignal = " UNKNOWN";
     endcase
 end

It should show up as readable text in the waveform viewer.

In Modelsim you can add FSM using following steps:

1. use FSM recognition and FSM coverage options (+acc, +cover) during compile,
2. use the -fsmdebug and -coverage options on the vsim command line.

Check ModelSim User's Manual for more details. Notice that using View > FSM list you can check all FSMs detected by ModelSim and add it to a wave.